Urgent plea! There's one particular property that has come on to the market that I especially like. Although I haven't sold my house yet (it's on the market), would the solicitor (the prospective property is vacant) accept a "letter of intent" from me in order to take it off the market? Note that I shall not require a mortgage.
MM
If you need to seel your house to finane the move I doubt it. I certainly wouldnt. Can you be certain how long yours will take to sell? You could always try a bridging loan till you sell yours then it would be no problem
My house *will* sell, but the market at the moment is "quiet". As for a bridging loan, what's that likely to cost me? (I never borrow money.)
MM
You have said your house "WILL" sell and that I dont doubt but as you also say how long. Yes a bridging loan will cost as well and I have no idea on that cost, see your bank. But why should the seller take the risk on letting you buy the property when? next week, next month, next year, never cos you pull out? You take the risk with a loan or other finance.
Of course heaven forbid I dare say this..... you could - err be economical with the truth.
I had a buyer for my old house who said he was a cash purchaser - then he suddenly had a mortgage half way through the proceedings, turned out he did have cash , tied up in another house.
Having said that I did a similar deed. I said my house was in the process of being sold when in fact it was up for sale ( well where is the lie in that ? it was in the process of being sold, just how you interpret it isnt it?). I knew it would sell pretty quickly ( cheap and cheerful) and I also had it in mind to raise a mortgage if push came to shove and I needed to find the dosh quickly and the house hadnt sold.
But of course that is hardly ethical.
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Forget letters of intent! If you are prepared to sign a *contract* to buy the property, the seller will almost certainly take it off the market. This will commit you to complete on a certain date, though - so you need to be sure that you can raise the money by that date - by borrowing if necessary.
I had someone else lie in exactly this way when they were buying our last house. Worse still, MY estate agent was colluding with them because they were selling them the mortgage which they allegedly didn't need. We very nearly lost our purchase because of a w*nker who told lies like this. Your absolutely right it's not ethical.
Al
Your chances are between zero and nothing. The most likely outcome is that they accept the offer in principle but don't take the house off the market. There's no harm in asking, though, and some people will give you a week or two, especially if the market is slow.
As for bridging loans, your main issue is what happens if the market collapses, leaving you holding 2 depreciating houses. You have to be sure you can sell before any crash, or you may find you don't sell for enough to cover the mortgage.
Christian.
Yes, thats just as common and it happened in my case too - both with my sale and my purchase. In fact the solicitor/conveyencer's were also in on the act . The held up the documents to allow extra time. The overall sale took three months .
We very nearly
I never had any intention of pulling out of my purchase - sale or no sale of my own house I was moving. I was screwed by people who made offers and then pulled out. One , it turned out couldnt raise a mortgage. The second did what the estate agent called a "bed and breakfast" on me - made an offer which I accepted. I took my house off the market but they were only securing my house in case they couldnt find another one. Things turned out they did find another. Problem was they didnt tell me or my solicitor or my estate agent until over three weeks later. Meantime I had lost several possible sales.
This by the way was at a time when the market was slowing down. The house I was buying on the other hand hadnt had a solid offer from anyone for 18 months - largely because the owner(s) had split up and moved out and left the place unclean, untidy, in need of decoration and full of rubbish in the loft.
Not all of us are w*nkers. Sometimes its better to have a purchaser who you know WILL buy even if its taking longer, than someone who says they will and then withdraws?
But it doesnt withstand the fact that such things are going on quite regularly and sometimes you might as well join the clan and go with the flow.
We were in a similar position Feb '03 but with a mortgage. Looking to move, house on market, found something we really wanted, made the offer, had it accepted. It went to a cash buyer a few weeks later. When we first heard about the other buyer I considered a bridging loan, etc, but didn't.
We lived in an area where houses used to sell like hot cakes but it took until Oct '03 to sell and we moved in Feb '04. While it probably wouldn't have bankrupted me to have to bank-roll two houses for a whole year it would have cost a shed load of cash I wouldn't really want to have lost.
In article , Mike Taylor writes
I've no doubt that your house will sell, but only if the price is right and the right person comes along. For instance I'll offer you £100 quid for it. There!, it "will" sell if you accept that price. Course you won't, but there will be a price that you will sell at, but its finding it which is the problem...
As to a bridging loan these aren't all that expensive. Failing that consider renting it out if there is a demand in your area. We did this and now have a collection of them!....
If you are confident in selling yours, you could offer a non-returnable deposit to encourage them.
As for
Bridging loans are usually about 2% above base rate which is currently about 4.5%, so about 6.5% per year
Nick Brooks
I take on board all of the above comments so far, re ethical and so on. I believe I am an ethical person and if I commited, in writing, to buying a property once my own property has been sold, I would stick by it. The situation is this: When I purchased my current propertysome years ago, I knew the moment I saw it in the advert that it was the right property for me. This is the exact same feeling I get having seen the advert for the prospective property. It is not the "only" property on my short list, but it has great potential, on a large plot, is secluded and in a village.
So, what do I do? I could simply wait around, only to see it snapped up by a builder, for example, or I could at least try to make my interest in it known. This, I hasten to add, is all before I have actually visited the property! I am now even considering the possibility of selling for cash to Chain-Savers and taking the hit. For, if the market really is on the wane (and several people recently have intimated that the slide is now in progress), my house might only be worth peanuts in a few months.
I could afford a deposit on the prospective property. Maybe that would show them that I was serious?
MM
TBH I'd be surprised if a letter of intent would be accepted as binding, but you can always ask.
I had the situation last year where a prospective client was going to buy our system. At the end of their evaluation period they decided to go with us at an agreed price, and sent us a letter of intent stating this. This was a big, important, sale. Unfortunately, they then decided to really mess us about for a couple of months, shaving down the price, asking for extended free support, etc etc, with the threat that they would be going to the competitor otherwise.
Legal advice determined that the letter of intent (though properly done) really wasn't worth the paper it was written on, so we had no security there at all.
So, in future, unless I have a signed contract in my hands, I will not regard any such deal as safely closed and commit myself to a path of action or expenditure that would put me in a difficult position if it fell through.
This would be the position of your prospective property's vendors if they have any sense.
However, as I say, you have nothing to lose by trying.
-- Richard Sampson
email me at richard at olifant d-ot co do-t uk
I think the one main requirement is finding that "right" person! I know, am absolutely convinced, that if my property were known about right this minute to a *hundred times* more people than normally would be expected to be searching on line, visiting estate agents, or reading the local newspaper, then I would probably sell it by the end of the week. There are only five ways that people can learn of the fact that my property is on the market: (1) Agent's window or via enquiry, (2) agent's or RightMove's/Vebra's/Fish4's web site(s), (3) for sale board, (4) local paper, (5) word of mouth. I have in addition some cards in newsagents' windows and an advert on a free web site.
Taking (1), the only people passing the agency on a weekday will be mainly business people or young mothers with a pushchair and they are usually all too much in a rush to look. Saturdays and Sundays may be the only days where the agent's window is truly useful. (2) how many people regularly peruse the internet, I mean, really? Most people I know still do not. They still look upon the internet as a bit of a weird novelty. Only the kids are the avid users, and I somehow don't think I'm going to be selling to a 17-year-old! So I think the internet route is a lot of hype. (3) could work if there is any significant passing traffic. In this road there is very little. (4) yes, but only once a week! (5) may happen, but probably quite rare.
Buy mine and rent it out! Houses fetch from £600 a month around here.
MM
Bridging loan?
Exactly mirrors my situation. Up to 18 months ago, you could practically guarantee a sale within a week. Identical houses selling in the same street or next almost immediately for the same kind of price - proportionately - that I am asking.
MM
Ah, if I could be sure of that, then that would be a different story! While I am convinced that my property *will* sell, I cannot possibly predict exactly when that will be. It may, for all I know, happen this very afternoon.
MM
In message , Mike Mitchell writes
No chance if the agent or solicitor are worth their salt!
Remortgage your current home at normal rates, then pay it off when you sell. Costs less than any hit you might take with a cash buyer, and you do say that you WILL sell.
If you are even slightly hesitant about doing the above because of a fear of being left with 2 houses in a depleting market, this is exactly the reason that the buyer should not agree to your proposal.
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